Crude oil futures traded lower on Thursday morning, after rising nearly 4 per cent in the previous session due to escalating tensions between the US and Iran.
At 9.56 am on Thursday, August Brent oil futures were at $69.50, down by 0.39 per cent, and July crude oil futures on WTI (West Texas Intermediate) were at $67.94, down by 0.31 per cent. June crude oil futures were trading at ₹5,804 on Multi Commodity Exchange (MCX) during the initial hour of trading on Thursday against the previous close of ₹5,731, up by 1.27 per cent, and July futures were trading at ₹5,706 against the previous close of ₹5,642, up by 1.13 per cent.
On Wednesday, US President Donald Trump said that US personnel were being moved out of the West Asia region because it could be a dangerous place. US would not allow Iran to have a nuclear weapon, he said.
Reports quoting the Iranian Defence Minister Aziz Nasirzadeh said that his country will attack US bases in the region, if nuclear talks fail and conflict arises with the US. Trump had earlier threatened Iran with bombing if it does not reach a new nuclear deal with it.
Escalating tensions between these two nations led to concerns over supply disruptions from the region. Iran is one of the major producers of crude oil.
Meanwhile, the official data from the US showed a decline in crude oil inventories in the US for the week ending June 6.
According to the US EIA (Energy Information Administration), US commercial crude oil inventories decreased by 3.6 million barrels for the week ending June 6. At 432.4 million barrels, US crude oil inventories were about 8 per cent below the five-year average for this time of year.
Total motor gasoline inventories increased by 1.5 million barrels from last week and were about 2 per cent below the five-year average for this time of year. Distillate fuel inventories increased by 1.2 million barrels last week and were about 17 per cent below the five-year average for this time of year. Total commercial petroleum inventories increased by 6.2 million barrels last week.
Total products supplied in the US over the last four-week period averaged 19.9 million barrels a day, up by 0.5 per cent from the same period last year. Over the past four weeks, motor gasoline product supplied averaged 8.9 million barrels a day, down by 2.5 per cent from the same period last year. Distillate fuel product supplied averaged 3.5 million barrels a day over the past four weeks, down by 5.9 per cent from the same period last year. Jet fuel product supplied was up 1.3 per cent compared with the same four-week period last year.
June natural gas futures were trading at ₹302.90 on MCX during the initial hour of trading on Thursday against the previous close of ₹299.90, up by 1 per cent.
On the National Commodities and Derivatives Exchange (NCDEX), July jeera contracts were trading at ₹19,925 in the initial hour of trading on Thursday against the previous close of ₹19,810, up by 0.58 per cent.
June cottonseed futures were trading at ₹3,090 on NCDEX in the initial hour of trading on Thursday against the previous close of ₹3,075, up by 0.49 per cent.